Tuesday, 10 May 2011
U.S. Reduces 2011 Natural Gas Output Forecast by 0.1%
The U.S. lowered its forecast for natural gas output in 2011 by 0.1 percent and raised its outlook for prices.
Marketed gas production will average 63.23 billion cubic feet a day in 2011, down from 63.32 billion estimated in April, the Energy Department said in its monthly Short-Term Energy Outlook, released today in Washington. The estimate is up 2.3 percent from 61.83 billion produced in 2010.
Production in the Gulf of Mexico will average 5.56 billion cubic feet a day, down from 5.62 billion estimated last month, according to the report from the department’s Energy Information Administration. Lower-48-state output is pegged at 56.63 billion, down from 56.65 billion.
The government agency said it expects production to “begin modest month-to-month declines that could continue through the year because of reductions in the number of active natural gas drilling rigs.”
Total gas consumption will average 66.48 billion cubic feet a day, down from 66.75 billion estimated in April.
Gas prices at the benchmark Henry Hub in Erath, Louisiana, will average $4.37 per million British thermal units, up from the previous estimate of $4.10, according to the department.
“The decline in drilling activity this year and forecast increase in consumption next year contribute to higher natural gas prices next year and a turnabout in drilling activity during 2012,” the report said.
LNG imports will average 940 million cubic feet a day this year, down from 1.05 billion forecast in April.
Demand for gas from power plants will average 20.29 billion cubic feet a day this year, up from the previous estimate of 20.28 billion. Industrial demand will average 18.43 billion, compared with 18.73 billion predicted last month.
Natural gas for June delivery rose 2.8 cents, or 0.7 percent, to $4.182 per million Btu at 12:30 p.m. on the New York Mercantile Exchange. Prices have declined 5 percent this year.
(Source: http://www.bloomberg.com/news/2011-05-10/u-s-reduces-2011-natural-gas-output-forecast-by-0-1-1-.html)
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